Now that many college seniors have flipped their tassels at graduation, parents are basking in the pride of having their college graduates back at home for the summer.But once the euphoria fades, time goes by and reality sets in, many parents are left wondering how to empty the nest while still making sure their children are on sound financial footing. It's a delicate balance, especially for those living in high-cost areas: Your children might not be babes-in-arms anymore, but they also might not be able to pay the bills alone. While allowing them to live at home saps the family resources and your own personal space, pushing them out before they're financially secure might cause more headaches. Dianne Reichel, a financial counselor with GreenPath Debt Solutions, says she has seen plenty of parents cover their kids' expenses to the detriment of their own fiscal well-being.
Living at home for too long isn't always fun for the young adult, either. Bob Augspurger's parents didn't force him out of the home, but the 26-year-old Villa Park, Ill., native finally had enough. He lived with his parents and younger sister until last September, when he moved out to a two-bedroom apartment with a co-worker. "If I'm out late after work, I have to call my mom and tell her, so she knows I won't be home for dinner," he says, referring to the time living with his parents. "If I'm going out, I have to tell her when I'll be home so she doesn't have to stay up and worry. If I sleep through my alarm clock, my mom wakes me up." And, he adds, forget about dating: "You can't bring someone home: 'Wanna come back to my house and chill out and watch TV? Well, you've got to meet my parents.' "
Branham suggests the kids and parents set deadlines and savings goals together, and even collaborate on job searches and apartment hunting. Parents should also make their children start taking responsibility for their own living expenses -- from car insurance to their share of the utilities -- and setting up a rent payment, even if it's a nominal sum. For instance, you might give your daughter six months to travel, explore her career options, set up a savings plan and get used to the idea of being an adult. You might say that within nine months, she must start paying $200 rent and a portion of the bills; within a year she needs to find roommates and a potential locale; and within 18 months she should have saved up enough to move out.
Time frames and dollar figures can vary by the local job market, living expenses and other factors, but the key is to start the conversation before it turns into an argument. "It can't be adversarial; it has to be conversational," Branham says. "Having those conversations early -- and often -- means that at some point you're not going to say, 'Get out of my house.' " It's important to expect some pitfalls along the way. Just because you set up a plan doesn't mean everything will flow accordingly. It's important to understand that your child might make some mistakes along the way. Make sure, however, that you let them make some mistakes so they can learn from them, instead of bailing them out each time something goes wrong. Augspurger now gets into scuffles with his roommate who doesn't cook, clean or wash dishes. He's also been told that he'll have to leave the apartment to make room for the roommate's fiancé. Still, he says, "it beats living at home."